What affects the cost of oil

I keep reading and hearing the argument that the more oil produced in the U.S., the lower the cost of gas. This argument is based on supply and demand. But the demand is based on a world market.

The argument supposes that we don't export that much oil or oil products. If we were talking about prior to 2003, that would have been true. But except for 2009, every year since 2002 our export of oil has grown. In 2002, the value of our oil exports was $10.3 billion. In 2010, the value of our oil exports topped $70.8 billion.

In 2009, the rate of oil products exported averaged about 1.92 million barrels of oil per day. We don't own the oil. It is owned by the oil companies, and they will ship it where it will generate the most profit for them. The pipeline to Houston will make it easier to export oil, gas, and oil products. If we are so dependent on foreign oil, then why are we exporting it in ever increasing amounts?

Just yesterday, the news commentators were talking about a temporary drop in the cost of gas and oil as a result of Sandy. The super storm is causing a temporary loss in demand for oil products, and thus a decrease in cost.

If we decrease our dependence on oil, this might mean a lower cost for people at the gas pump. But as long as people overseas are willing to pay more, oil will be exported and the cost of oil and gas will go up.

John Rogers

Jackson

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What affects the cost of oil

O.K. I really don't get it. I keep reading and hearing the argument that the more oil produced in the U.S., the lower the cost of gas. This argument is based on supply and demand. But the demand is